U.S. sanctions target food subsidy scam in Venezuela, charges businessman

U.S. sanctions target food subsidy scam in Venezuela, charges businessman

The United States has been pursuing a policy of economic sanctions and diplomatic isolation against the Venezuelan government in support of the opposition leader Juan Guaido.

Announced Thursday, the sanctions target Maduro's stepsons Walter, Yosser and Yoswal, their cousin Carlos Erica Malpica Flores and Colombian Alex Nain Saab Moran for profiting from food imports intended for Venezuela's poor. "Treasury is targeting those behind Maduro's sophisticated corruption schemes, as well as the global network of shell companies that profit from the former regime's military-controlled distribution program".

The so-called CLAP boxes, a Spanish acronym for Local Committees for Supply and Production, have become a tenuous lifeline for millions of citizens suffering from shortages and hyperinflation that reached 130,000% a year ago. "They use food as a form of social control, to reward political supporters and punish opponents, all the while pocketing hundreds of millions of dollars through a number of fraudulent schemes".

The collapse of the Venezuelan economy has caused a mass exodus of some 4 million people and widespread hunger and severe food shortages in the past few years. According to a Human Rights Watch report, 80 percent of households are food insecure, two-thirds of its population had reported losing weight and nearly 12 percent was undernourished.

Earlier this month, he ordered that every branch of the Banco de Venezuela should let citizens buy and trade El Petro, the state-issued cryptocurrency he's hoping will provide a much-needed workaround economic sanctions.

The treasury claimed that Saab, who personally profited from overvalued contracts including the Venezuelan government's food subsidy program, also funneled money to Maduro's stepsons in exchange for access to Venezuelan government contracts.

Saab also began in 2018 to help the Venezuelan government liquidate gold mined in Venezuela and convert it into foreign currency, the Treasury said. A U.S. State Department spokesperson said the license had been extended for the five companies, adding that "the limited scope of the license is meant to facilitate U.S. oil companies in abiding by their contractual obligations, maintaining their operations assuming they choose to do so, and avoiding economic harm to the United States."The spokesperson added that Washington "will continue to take appropriate action against Maduro and those aligned with him."As of July, Venezuela's output was just 734,000 bpd, about half of what it averaged in 2018, prior to U.S. sanctions, when production was 1.4 million bpd, according to OPEC figures".

In a contract - allegedly yet to be signed - the Jetman Pay app would be used to directly defy the USA ban again.

The US imposed sanctions on the Venezuelan gold sector a year ago. In that way, they managed to receive USA dollars at the government's overvalued exchange rate, eventually transferring out of Venezuela more than $350 million, some of which was used to pay kickbacks to corrupt officials.

US officials believe Saab's rise began a decade ago after he obtained an agreement to build social housing for the Venezuelan government.

Maduro's stepsons couldn't be reached for comment.

As Saab and Pulido's influence grew, they drew the attention of the Trump administration, which has made a priority of going after top Venezuelan officials where it hurts them most: their wallets.



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